How hybrid electric vehicles can pay off

This past year has seen the U.S. surpass 388,000
alternative vehicles sold representing 3 percent of new car sales
and average market growth of 35 percent per year since 2001. Back
then, the only hybrid electric vehicle (HEV) with annual sales over
10,000 was the Toyota Prius, which was first introduced in 19971.
While other alternatives have emerged, including plug-in hybrids
(PHEV) and the extended range electric vehicle (EREV) subset, full
electrics (EVs), hydraulic hybrids in the commercial vehicle sector,
and other alternative fuel combustion engine vehicles; hybrids
remain the predominant alternative option with the Prius selling
more than100,000 vehicles per year over the last seven years,
reaching a cumulative total of more than1,000,000 vehicles in 2011.2

As in previous years, several news reports have questioned and
examined the value and future of HEVs. Now, as the U.S. enters the
second decade of HEV sales, the question is still examined:

“Why do people buy a hybrid vehicle?”

According to the New York Times research compiled by TrueCars.com,
only two HEV models (and one diesel) have a fuel and maintenance
savings payback for the incremental cost of the alternative
powertrain technologies within a five- to ten-year period at current
and recent historical high gas prices.3
Furthermore, payback is dependent on incentives including the
federal tax credit up to $7,500.

These analyses are simplified by assumptions about the conventional
vehicle purchase choice that consumers are comparing, which is often
not the same vehicle in a non-hybridized option (e.g. your purchase
choice may not be between a Chevy Cruze and Volt). But there is some
evidence that with the current offerings, the market will begin to
level off as early adopters, technology enthusiasts, green
purchasers, and those with more complex return on investment
assumptions become saturated as indicated by recent market studies
suggesting only 35 percent of HEV owners are purchasing another HEV
for their next vehicle.4

I think the best EV in the world is the Tesla Model S. It's fast and comfortable with an incredible mile range! If I have $80,000 I would definitely buy one for myself!
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http://www.carid.com/

I think the discussions here is far more interesting than the article itself. To some viewpoints that I agree - EV or PHEV should still be investigated in order to achieve a long term green vehicle. Without consumers' support, the development will be easily in dead end as the hurdle - say battery technology - is very difficult and costly to overcome. The result then is that our future generations will not be benefited when coal or oil are still a limited resource.

You'd actually be surprised, there's a lot of technology that goes into making cars clean, and part of it is combusting precise amounts of fuel mixed with air. Also coal is a very dirty fuel where as petrol and much more so LPG are much more pure. There is coal gasification, but you still have a lot of impurities that are harder to scrub

I don't know about USA, but here in Australia many cars are fueled by LPG (Liquefied Petroleum Gas). We have good supplies of natural gas (we are a major exporter of it) and LPG presently retails for half the price of petrol (gasoline). Regular petrol-engine cars can be converted to LPG-only or dual-fuel (2 tanks + changeover switch) for a couple thousand dollars. This is economical for high usage vehicles - taxis, delivery & fleet vehicles, large family cars and SUVs. Some major car models are also offered with a factory LPG fuel option.
LPG is a practical choice for high fuel consumption vehicles.

Thanks Steve for your detailed account. It would be interesting for everyone here I think if you could post followups over the life of the car, TCO is often an individual experience. I'm especially interested in your experience with the batteries. It would be also nice to look back at some later stage as to how the eco-economics look

2012 Prius Plug In, delivered April 2012, now with 8.5K miles and drive about 20K/yr. The reason I got the PHEV was to try to reduce the overall operating expenses (e.g., higher gas mileage with ability for EV mode) and the CA car pool lane sticker.
30 mile one way daily commute charging 3.1 KWH into the 4.4 KWH battery with 120V at home then also at work (free electric) – MPG range is 90 – 100 MPG using combination of EV mode and HV mode (start in EV, switch to HV greater than 65 MPH on freeway and then go back to EV mode in time to fully deplete battery before arriving at work). I get 51-53 MPG just in HV mode and 58 MPG when driving to work in same speed profile as when in EV mode (e.g., slow traffic and/or less than 65 MPH).
Breakeven for the Prius is about $0.30 per KwHr (I get about 12 miles EV range per charge). I have moved to the CA PG&E E-9A time of use electric rates (one meter for home and EV). Since the charging rate is 8 amps at 120V and the Prius needs only 3 hrs to fully charge I will not get a 240V home charging station. Average about 15 KwHr/day total usage with 30K KwHr on laundry days, monthly about 440 KwHr ($68). Payback from gas savings will be about 10 years
The optimum PHEV would be the new Ford Energi. It is about the same price as the Prius PHEV ($3750 federal credit and $1500 CA rebate) but nicer inside. Gas mileage is 47 MPG with 21 miles electric range.
The two key things are: 1) ability to go up to 85 miles per hour in EV mode in the Energi vs 65 MPH in the Prius since 2/3 of my commute is on the highway; 2) the 120V charging time is 7 hrs vs the 3 hrs in the Prius (battery is 7.6 KwHr vs 4.4 KwHr on the Prius) which is the same as the midnight to 7 AM lowest rate time of use period and also about the amount of time parking at work so I can maximize the usage of the lowest cost electricity.

A stationary power plant, unfettered by weight and size constraints, can be more efficient than a mobile power plant using the same fuel. Then again, transmission costs whittle into that.
Nevertheless: According to Consumer Reports, 3.5 cents per mile in a Nissan Leaf vs. ~12 cents per mile in a similar-profile pure-gasoline car. That's around $12K saved over a 150Kmile life of a car. Will that compensate for the purchase-price difference? Probably, but will you keep the car that long? I buy a car and drive it into the ground, so "yes" for me, but perhaps not for others.
Will range limits ruin the driving experience? Possibly. I personally think that a battery-EV currently is only viable as a second car, or more accurately, as a first car. That is, rare is the day that I drive more than 80 miles per day (or between charges), but not nearly rare enough.
Will battery life be an issue? Not clearly known. That's a very complex question.
It also depends on how much engine noise annoys you. In my Prius, hardly anything pleases me more than to sit at an intersection with the loudest noise being the idling engine - of the car next to me! On the other hand, some people really love a hot-rod sounding car. Not me; I want a car to be as nearly silent as possible.
Also, it's not necessarily a coal power plant. Wind energy is growing rapidly. It could also be hydro-electric, or nuclear, say. But yes, that's certainly still a small percentage, so far.